Bush: Financial rescue plan will take time

JENNIFER LOVENAssociated Press Writer

Published Tuesday, October 07, 2008

CINCINNATI -- As Wall Street reeled and global markets plunged, President Bush on Monday said the U.S. economy is going to be "just fine" in the long run. But he cautioned that the massive rescue plan will take time to work.

On another jittery day in the financial markets, the president made two rounds of unscheduled comments on the economy -- first after meeting with small-business owners in San Antonio, and then at the top of a speech in Cincinnati about judicial nominees.

In both cases, he defended the $700 billion economic bailout plan as one that won't just help Wall Street, but everyday workers and businesses, too.

"I believe that in the long run, this economy is going to be just fine," Bush said. In the short term, he said the Treasury Department must go about enacting its plan to buy up troubled assets from financial firms so that credit will start flowing again to consumers.

Recognizing the scope of the government's intervention, Bush to reassure his audiences that taxpayer money will not be wasted.

The president added that the country has been through rough times before, and "we're going to come through just fine."

Earlier, in Texas, Bush emphasized that the program must be effectively designed and not rushed into action.

"It's going to take awhile to restore confidence in the financial system," he said. "But one thing people can be certain of is that the bill I signed is a big step toward solving this problem."

Bush signed the bill into law after Congress approved it last week.

On Monday, the Dow fell as much as 800 points at one point.

The catalyst for the selling was the growing realization that the Bush administration's $700 billion rescue plan and steps taken by other governments won't work quickly to unfreeze the credit markets. Global banks, hobbled by wrong-way bets on mortgage securities, remain starved for cash as credit has dried up.

The president, after a weekend at his ranch in Crawford, Texas, met with small business owners at an old-fashioned soda shop in San Antonio. He said he understands why so many people are frustrated about why they were suddenly "helping Wall Street."

"The answer is because had we not done anything, people like the folks behind me would be a lot worse off," Bush said as the business owners stood with him. "We'll make sure, as time goes on, this doesn't happen again."

Bush's comments came as his top economic advisers pledged to work with their counterparts around the world to restore confidence and stability to financial markets roiled by tight credit and worries about a global economic slowdown.

To that end, the administration was expected to announce shortly that it had tapped a 35-year-old former Goldman Sachs executive, Neel Kashkari, to head the government's rescue effort on an interim basis, according to an official who asked not to be named.